Worthington Industries, Inc. (NYSE:WOR) shareholders have witnessed an increase in hedge fund sentiment recently.
According to most shareholders, hedge funds are perceived as slow, outdated financial vehicles of yesteryear. While there are over 8000 funds in operation at the moment, we at Insider Monkey look at the upper echelon of this group, around 450 funds. It is widely believed that this group oversees the majority of the hedge fund industry’s total capital, and by paying attention to their best stock picks, we have discovered a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Equally as integral, optimistic insider trading activity is another way to parse down the world of equities. As the old adage goes: there are a number of stimuli for an insider to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Various academic studies have demonstrated the market-beating potential of this tactic if you know what to do (learn more here).
Keeping this in mind, it’s important to take a glance at the recent action regarding Worthington Industries, Inc. (NYSE:WOR).
What does the smart money think about Worthington Industries, Inc. (NYSE:WOR)?
In preparation for this quarter, a total of 10 of the hedge funds we track held long positions in this stock, a change of 25% from the previous quarter. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes significantly.
According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the most valuable position in Worthington Industries, Inc. (NYSE:WOR). Royce & Associates has a $53.1 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is Dreman Value Management, managed by David Dreman, which held a $30.4 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Cliff Asness’s AQR Capital Management, Joel Greenblatt’s Gotham Asset Management and Israel Englander’s Millennium Management.
As industrywide interest jumped, specific money managers were leading the bulls’ herd. Gotham Asset Management, managed by Joel Greenblatt, created the most outsized position in Worthington Industries, Inc. (NYSE:WOR). Gotham Asset Management had 3.9 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $2.9 million investment in the stock during the quarter. The other funds with brand new WOR positions are D. E. Shaw’s D E Shaw, Steven Cohen’s SAC Capital Advisors, and Ben Levine Andrew Manuel and Stefan Renold’s LMR Partners.
How are insiders trading Worthington Industries, Inc. (NYSE:WOR)?
Insider purchases made by high-level executives is particularly usable when the company we’re looking at has seen transactions within the past half-year. Over the latest 180-day time period, Worthington Industries, Inc. (NYSE:WOR) has experienced zero unique insiders buying, and 5 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Worthington Industries, Inc. (NYSE:WOR). These stocks are Allegheny Technologies Incorporated (NYSE:ATI), Mueller Industries, Inc. (NYSE:MLI), Carpenter Technology Corporation (NYSE:CRS), Chart Industries, Inc. (NASDAQ:GTLS), and Sims Metal Management Ltd (ADR) (NYSE:SMS). All of these stocks are in the metal fabrication industry and their market caps match WOR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Allegheny Technologies Incorporated (NYSE:ATI) | 23 | 0 | 2 |
| Mueller Industries, Inc. (NYSE:MLI) | 21 | 1 | 3 |
| Carpenter Technology Corporation (NYSE:CRS) | 11 | 0 | 5 |
| Chart Industries, Inc. (NASDAQ:GTLS) | 16 | 0 | 6 |
| Sims Metal Management Ltd (ADR) (NYSE:SMS) | 4 | 0 | 0 |
With the returns exhibited by our strategies, retail investors must always watch hedge fund and insider trading sentiment, and Worthington Industries, Inc. (NYSE:WOR) is an important part of this process.
